Credit bureaus sell and sell your personal information

By: Jessica White/DC Columnist

Posted: 6/10/07

Dear Ms. Mortgage Maven,

I need to refinance my home. I am reluctant to do so, however, because the last time I applied for a mortgage I was bombarded by unsolicited calls from mortgage lenders who got my name somehow from the credit bureaus. I have since contacted the three credit rating bureaus to prevent them from selling or sharing my information, but it is my understanding that applying for a mortgage will negate the opt-out status that I placed on my accounts. Is this true?

Thanks!

Ben

Dear Ben,

The credit bureaus (or their affiliates) do indeed sell your information, as it relates to mortgage applications and more. In the mortgage lending arena, one product that they sell is called "24 Hour Trigger Data."

When someone applies for a home loan, credit bureaus can sell that person's contact information to middle men who sell it to lenders. The lenders will then call you and to solicit your business away from the lender who pulled your credit report.

If three or four lenders pull your report, your data could be sold several different times. The lender can specify that it will only buy leads meeting certain criteria. For example, it can specify that it wants people who have a certain loan-to-value ratio, have a certain credit score, or are in a certain geographic region.

According to one data seller that I talked to, it is easier to buy refinance leads (which is exactly your situation) than purchase leads. And the data reseller offers an array of leads for mortgage lenders - verified leads, live transfers, 24-hour trigger leads, Internet mortgage leads, Spanish leads, aged mortgage leads and television response leads. And FYI - the same company also sold leads for debts and insurance, presumably also bought from one or more credit rating bureaus.

Equifax's Web site privacy policy is not exactly easy to find but reads (under Site Assistance FAQs) as of June 1, 2007:

'Does Equifax Consumer Services, Inc. use my Equifax credit file to market its products and services? Does Equifax Consumer Services, Inc. sell my name to direct mail companies? No. However, our affiliate, Equifax Information Services, LLC which maintains your credit file, does provide information to credit card companies and lenders so that they may offer pre-approved credit to consumers as permitted by the FCRA.

If you prefer not to receive such offers, call us toll free at 1-888-5-OPT OUT, or send your request to:
Options
Equifax, Inc.
P.O. Box 740123
Atlanta, GA 30374-0123

Please include your complete name, full address, Social Security number and signature. Equifax Information Services will remove your name from "pre-approved credit card orders," and share your request with the other two major credit reporting agencies.

To opt-out from direct marketing sales, which is different from credit card pre-approvals, send your request to:
Direct Marketing Association
P.O. Box 9008
Farmingdale, NY 11735-9008

I called the phone number, and the automated attendant said it was the opt-out line for the Consumer Credit Reporting Industry. Once you go through the prompts (you can select opting out for five years or permanently), it will mail you forms to opt-out of all four credit bureaus (Equifax, Experian, Transunion and Innovis, which is not listed in the Web site's privacy policy quoted above). You must return the forms to opt-out permanently. If not, you will be opted-out for only five years. It also said that you can opt-out by going to www.optoutprescreen.com. (I went to this site. You can opt-out online for five years. The permanent opt-out has to be done in writing. You can order the forms through the Web site or the toll free number, but you must complete and return them to have the opt-out take effect.)

I think you may want to call the opt-out number or opt-out online, and write the Direct Marketing Association because this may fall under direct marketing rather than a pre-approval.

I will keep looking into it. Any additional information or clarification will be the subject of a future column. Regards.

Jessica White, also known as "Ms. Mortgage Maven," is a local mortgage lender and is affiliated with a well-known national lender. She specializes in helping first time homebuyers and can use DC HPAP, the DC Bond program and the Maryland CDA programs. Please call or email her with your questions at 202-607-4449 or Jessica@msmortgagemaven.com.